Any other COVID-19 related expenses not already covered through grants, forgivable loans or other relief through federal, state, county or city programs. eidl for real estate agents Businesses that were not in operation on or before February 15, 2020 are not eligible for second draw PPP loans. None of the information on this site constitutes legal advice. We are a technology company that uses software and experience to bring lenders and borrowers together. After 14 Days it's just $67/month! Step 3: Multiply the average monthly gross income or net profit amount from Step 2 by 2.5. C.A.R. SBA 7(a) Loans is a endstream endobj 2031 0 obj <. For example, if youre qualified to borrow up to $50,000, you can change that amount to the amount you wish to borrow, up to $50,000. Additionally, realtors can use the loan to help small businesses find the funding they need to purchase commercial real estate in the first place. Must not use proceeds for any of the following: Funding for other debts (refinancing, consolidating, or repaying). What happens if any portion of my PPP loan is not forgiven? Please refer to the Targeted EIDL Advances section below for more information. eidl for real estate agents Your business structure must remain the same for the life of the loan. What are the PPP loan terms for any amounts that are not forgiven? (Note: The cap is based on 8 weeks worth or $15,385, whichever is less, for an 8-week Covered Period.). Many real estate agents may find that the SBA 7(a) program, the Small Business Administrations most commonly used loan program, is the best fit for their needs. On May 4, the SBA opened EIDL applications to agribusinesses, which suggests that afterwards they will likely reopen applications to everyone else who is eligible. Since the definition of payroll costs includes employee salaries, wages paid by an S Corporation will be considered payroll costs that can be covered by PPP loan proceeds. If you only have a personal checking account, these lenders will still not accept your PPP application. PPP loans are offered on highly favorable terms for borrowers: They are forgivable, they are guaranteed by the government, and payments are deferred. As real estate agents, we are exactly who these legislations were designed to help. Texas Property Tax Loans | Help with Delinquent Property Taxes Economic Injury Disaster Loan Program: Members electing to report PPP loan proceeds to EDD should do so over 8 weeks following when the loan was disbursed. If your loan was too high (for example, if you received more than $20,833 despite not having any employees), then it might not be possible to obtain full forgiveness. SBA EIDL Loans are ELIGIBLE for Rental Properties FIND A LENDER: Application period begins April 10th, Economic Injury Disaster Load Emergency Advance. I'm a Paperless Agent subscriber and appreciate ALL the information and support you provide us with - THANK YOU! For worker protection expenditures: Copy of invoices, orders, or purchase orders paid during the Covered Period and receipts, cancelled checks, or account statements verifying those eligible payments, and documentation that the expenditures were used by the borrower to comply with applicable COVID-19 guidance during the Covered Period. Get referrals from family or friends who have used an agent or look for one who is active in the neighbourhood in which you are selling or buying. for Real Estate Agents Dadyan and her co-conspirators used dozens of fake, stolen or synthetic identities All EIDL loans carry a term of 30 years, with an interest rate of 3.75%. What forms do sole proprietors need to provide to the lender to apply for a PPP loan? Nothing on this website is an offer or a solicitation for a loan. The list of partners, organized by location and by language services, can be found. When can I submit my loan forgiveness certification or application? How can I apply for a targeted EIDL advance? Right now, there are over 2 million Americans with active real estate licenses, and over 1.3 million members of the National Association of Realtors, Apply for a loan in minutes and get multiple quotes today The interest rate on an EIDL loan is 3.75% APR (fixed) with a 2.75% APR available for nonprofit organizations. Real-estate brokers, are you looking for clarity around what help youre eligible for during the COVID-19 crisis? Loan forgiveness means that you are not required to repay your loan. For a complete FAQ about the California COVID-19 relief grant program, please refer to this page: 2021Copyright CALIFORNIA ASSOCIATION OF REALTORS. I think my lender allowed my loan amount to be too high. First, shop around! The lender is responsible for notifying the borrower of the forgiveness amount after the SBA makes its decision. Best Homeowners Insurance for New Construction, How to Get Discounts on Homeowners Insurance. Payment receipts, cancelled checks, or account statements documenting the amount of any employer contributions to employee health insurance and retirement plans that you included in the loan forgiveness amount. Lastly, and very importantly, the SBA instructs that before applying for a PPP loan, borrowers should consider whether their potential access to other sources of liquidity ultimately makes a PPP loan unnecessary to support their ongoing operations. Using line 7 gross income will usually lead to a higher loan calculation, so it will be preferred for most sole proprietors. To be eligible for a supplemental targeted advance, an entity must meet all of the criteria above, plus: (1) the entity must employ not more than 10 people; and (2) the entity must have suffered an economic loss greater than 50 percent. Any thoughts on what to do here? Borrowers with loans of $150,000 or greater will need to submit additional documentation to obtain forgiveness. If you have already applied for or received an EIDL loan related to COVID-19 before April 3, 2020 and used the loan proceeds to cover payroll costs, you will be able to refinance the EIDL into a PPP loan for purposes of loan forgiveness. The EIDL has a 30-year repayment plan, and there is no prepayment penalty if you decide to pay early. Eligible utility costs include payments for a service for the distribution of electricity, gas, water, transportation, telephone, or internet access for which service began before February 15, 2020. Is SIC code 6531 eligible for EIDL loan? The proprietor expenses or owner income replacement portion of the PPP loan can be spent by the borrower on anything, at any time. Press J to jump to the feed. Before you agree to a loan, be sure that you are aware of and understand EIDL loan terms and requirements adequately. Eligible rent costs include payments for rent obligations on real or personal property under a leasing agreement in force before February 15, 2020. For more information about the Loan Necessity Questionnaire, please refer to question #53 of. To verify full-time equivalent employees, you must submit payroll tax filing reported (or that will be reported) to the IRS (typically, Form 941) and state quarterly business and individual employee wage reporting and unemployment insurance tax filings reported (or that will be reported) to the relevant state. Generally, receipts are considered total income (or in the case of a sole proprietorship, independent contractor, or self-employed individual gross income) plus cost of goods sold, and excludes net capital gains or losses as these terms are defined and reported on IRS tax return forms. Once received, the loans may be used by brokers for payroll costs (including paid sick leave), employee salaries, insurance premiums (including health, group life, vision, and dental insurance premiums), rent expenses, mortgage expenses, utility expenses, PPE expenses, operations expenses, property damage costs, supplier costs, and other debt obligations. Copyright 2022 Janover Inc. All rights reserved. Thus, if you are a Schedule C filer whose gross income is greater than $150,000 and you apply for a PPP loan, the SBA may send you a Loan Necessity Questionnaire to verify that current economic uncertainty made the loan request necessary to support the ongoing operation of your business. Use of funds was expanded to Pursuant to guidance from the Department of the Treasury, CPAs are not supposed to charge fees for assistance in preparation of a PPP loan application. And once youre done, you just submit the application and wait for a response, which includes a loan quote. Additionally, per the SBAs Interim Final Rule, sole proprietors must have claimed or been able to claim these expenses as deductible on their 2019 or 2020 IRS Form 1040 Schedule C in order for them to be forgivable when paid with PPP loan proceeds. If the borrower applies for forgiveness before the end of the Covered Period and has reduced any employees salaries or wages in excess of 25%, the borrower must account for the excess salary reduction for the full Covered Period. (Note: Sick leave tax credits under the Families First Coronavirus Response Act (FFCRA) are not included as payroll costs that can be paid with a PPP loan. The one-page certification form requires the borrower to provide: The number of employees retained by use of the loan. Check with your lender for specific details on how they will accept applications. 2054 0 obj <>/Filter/FlateDecode/ID[<8C8FAFB2856FD243BB76F15BC6E77F5A>]/Index[2030 41]/Info 2029 0 R/Length 108/Prev 228727/Root 2031 0 R/Size 2071/Type/XRef/W[1 2 1]>>stream However, if you get the $10,000 advance from the EIDL, you cannot use it for payroll costs and must instead use it for other business expense obligations. If I received an EIDL advance, will the amount of the advance be deducted from my PPP loan forgiveness? Copyright, Trademark and Patent Information, An individual who operates as a sole proprietorship or as an independent contractor, A private nonprofit organization that is a nongovernmental agency or entity, Any illegal activity as defined by the federal government, Any activities of a prurient sexual nature, Earning more than one-third of its gross income from legal gambling activities. For operations expenditures: Copy of invoices, orders, or purchase orders paid during the Covered Period and receipts, cancelled checks, or account statements verifying those eligible payments. When the EIDL loan was first offered, business owners were given an option to apply for a loan advance that the SBA would consider a grant, provided that all the necessary criteria were met. 2021Copyright CALIFORNIA ASSOCIATION OF REALTORS. If the first disbursement is not made within 90 days from receipt of an SBA loan number, the EBL loan will be canceled. The EIDL loan application is streamlined for easy completion. They want to know all of your debts. However, it is possible the state law will be changed to conform with the new federal law. Use r/TargetedEIDL for advance/grant issues. I tried to apply for a PPP loan at my bank, but the bank refused to consider my application or rejected it. It was very helpful.I have applied for both loan. The SBA will reach out to those who qualify to explain how to receive a targeted EIDL advance. About COVID-19 EIDL SBA has not yet announced when these remittances will occur. Will I need to pay income tax on the PPP loan proceeds if I use the proceeds for income replacement? Though SBA disaster loans have been available for years, the EIDL was signed into law in March of 2020 as part of the CARES Act, which was passed by Congress to provide emergency relief to American workers and small businesses struggling to survive due to the impact of COVID-19. Applying for the EIDL does not restrict your ability to also apply for the PPP if you are eligible for both. Check with your lender to determine if you will be required to submit a paper version of the application or if the lender will be offering an electronic application. Thats why the EIDL loan application is such a pleasant surprise. However, lenders and borrowers can mutually agree to modify the maturity terms of a PPP loan. In our next piece, we also cover two big tax options real estate brokers can use to provide further relief. However, keep in mind that EIDLs (with the exception of targeted advances) are conventional loans and not forgivable. You could, if desired, get a PPP loan to cover payroll costs (defined below) and other costs that are forgivable under the PPP, and then get an EIDL loan to cover some of your other expenses. Low-income community is defined in the Internal Revenue Code as any population census tract where the poverty rate is at least 20 percent, or (i) in the case of a tract not located within a metropolitan area, the median family income for such tract does not exceed 80 percent of statewide median family income; or (ii) in the case of a tract located within a metropolitan area, the median family income for such tract does not exceed 80 percent of the greater of statewide median family income or the metropolitan area median family income. After that, PPP loans are 75% guaranteed for loans exceeding $150,000 and 85% guaranteed for loans equal to or less than $150,000. Please check this FAQ frequently for updates. Its a time for family, friends and creating lasting memories. How do I calculate my maximum PPP loan amount if I am a sole proprietor without employees? However, emergency grants will now be targeted, meaning that the eligibility criteria are more restrictive. The real estate industry was adversely affected by statewide and local orders that were put in place in response to the COVID-19 pandemic. If you need immediate financial relief, arranging an SBA Express Bridge Loan (EBL) (discussed below) with your lender is a good option. If you only have a personal checking account, these lenders will still not accept your PPP application. The SBA is stating that PPP loan forgiveness for payroll costs for sole proprietors without employees is limited to: (i) proprietor expenses when calculating your PPP loan using the gross income formula; and (ii) owner income replacement when calculating your PPP loan using the net profit formula. Must be impacted by COVID-19 and the health and safety restrictions such as business interruptions or business closures incurred as a result of the COVID-19 pandemic. However, keep in mind that all loan proceeds for borrowers without employees can be attributed as proprietor expenses or owner income replacement, and there is no need for these borrowers to attribute any of the loan proceeds to the non-payroll costs category. New to real estate and Carolina Ones James Island office, Arnold is the owner of a small business specializing in Live Edge Furniture and Home Dcor. For example, if youre looking to change your business structure from a sole proprietorship to an S corporation, you will first need the approval of the SBA. But what if we told you that the, The Commission Calculator is Available NowWe love the holidays at the Paperless Agent. Consult with your accountant if you need assistance determining your gross receipts, and/or refer to SBAs FAQ document available, Once received, the loans may be used by brokers for payroll costs (including paid sick leave), employee salaries, insurance premiums (including health, group life, vision, and dental insurance premiums), rent expenses, mortgage expenses, utility expenses, PPE expenses, operations expenses, property damage costs, supplier costs, and other debt obligations. Weve all come to expect an overly complicated process when it comes to anything associated with government programs. Also, you will want to determine if the lender has a specific timeline indicated in its written materials that promises to provide a response when you submit an application request. For C-corporation owner-employees, owner income replacement is capped at 2.5 times their average monthly 2019 or 2020 employee cash compensation and employer retirement and health insurance contributions made on their behalf. Can a sole proprietor include a prorated portion of their home mortgage interest payments, home rent payments, and/or home utility bills as eligible non-payroll expenses if they have a home office and deduct these expenses on their IRS Form 1040 Schedule C? However, if you run a larger brokerage that wants to use an SBA loan to purchase (or even build) a new headquarters, an SBA 504 loan could be a superior option. Eligible entities will be able to receive additional $5,000 grants through this program. Complimentary Self-Defense Class for Real Estate Agents. As an Ebby Halliday client, youll benefit from knowledgeable, respected agents and a team of trusted professionals dedicated to making buying or selling your Schedule of liabilities for a real estate agent : r/EIDL - reddit